KELLINGLEY deep pit mine faces closure within the next 18 months.
UK Coal has announced it is consulting on plans to shut Kellingley near Selby, which employs 700 people, together with Thoresby in Nottinghamshire, which employs another 600.
A spokesman for the company confirmed that a formal consultation with the trade union over the future of the deep pit began late last night, and is set to run for 45 days.
The company has for some time been looking for external investment to allow it to manage the closure of its deep mines including Kellingley, over around 18 months.
The best possible outcome of the company's talks over investment, which it needs "sooner rather than later" would involve a managed closure of the pit, the spokesman said.
An influx of cheap coal from the USA and the strong pound have both contributed to tough trading conditions, he added.
Selby MP Nigel Adams said the news made for a "terribly sad day for the coal industry."
He added: "I have been speaking with UK Coal for a number of weeks, and knew they were in deep trouble. It had been hoped there would be a buyer to take it on, but unfortunately that has not happened."
He said the news came after several restructures at the company and huge pressure on the price of coal over recent years.
"I will be pressing the government to see what they can do during the wind down of this industry to ensure the resettlement process is palatable for the 100s of skilled workers at the mine."
The plans will leave employee-owned Hatfield colliery in South Yorkshire as Britain's last remaining deep pit mine.
In January nine new miners started work at Kellingley, the first new recruits in four years, and in July last year the Kellingley jobs were seemingly saved when an administration deal saved UK Coal.